This is how Sony plans to make virtual reality films a long-term business

Virtual reality (VR) is a long way off from becoming a money maker for movie bosses and for Sony the challenge to date has been resisting the urge to fuel hype for the medium and instead understand the value it could bring.

Consequently, it is not about the money right now, admitted the studio’s senior vice-president of VR, Jake Zim. Speaking at this year’s CES where analysts have lamented the lack of breakthrough VR innovations, the film executive argued it was wrong to expect too much from a fledgling medium too soon.

“In this moment, VR is not going to be breadwinner from a revenue standpoint for the studio so what value does it bring back... this is what we’re trying to figure out now,” he continued.

So far Sony has settled on the idea that it’s a way to build brand. If a celebrity or artist wants to position themselves at the cutting edge of the industry, then this is a way to do it. “If you’re an A-list talent saying ‘I want to be in VR because I want to show that I’m in this new space, and want to learn from it to make my brand relevant’ then you need to look t the benefit it can offer,” he continued.

“That’s not necessarily quantifiable... Our space has to recognise that it’s not about the money today for VR, but we also have to recognise the world has changed for talent and celebrities to the point where it’s about building your personal brand.”

Streaming service Hulu has similar expectations for VR but admitted it wouldn’t commission a VR project unless it could generate money. The business has just launched On Stage, a short-form series produced in partnership with Live Nation for its VR app to take viewers behind the scenes at concerts. And one of the first brand’s to sponsor it is Universal. “We have to ask ‘can it [VR projects] make money’ because we don’t have the luxury right now to take a flier [gamble] and that has made us sharpen our view of how it can have a point of view in the market,” said Hulu’s vice-president of emerging technology Noah Heller.

It’s why Hulu uses replayability as one of the main KPIs to assess VR projects; is an episode or piece of content rewatchable so the viewer can see something new when they look in a different direction? or is it something they might show their friends when they come around when they want to show off their Oculus Rift?

This “naturally lends itself to integrated brands and product placement," according to Heller.

Zim’s insistence on patience belies just how young the medium still is despite how much it has changed over the last 12 months. A year ago, the Oculus Rift hadn’t even launched in the UK or Canada, while the subject of monetisation was barely touched on at 2016’s CES. Now, there’s far more experimentation from media owners; whether it’s Hulu launching its On Stage service that puts viewers alongside Lil Wayne, Major Lazer and more or Fox and director Ridley Scott collaborating on VR experience for the upcoming Alien sequel.

“I think many of us in the traditional [media] space have looked at what’s transpired over the last 10 to 15 years when we held back on deals and said ‘no we’re not going to dive into digital’ or ‘no we’re not going to license our content on these sites’ and seen that its created a stunted learning environment that’s allowed for the Facebooks, the Googles and the Hulus to get a position in the market,” said Zim.

“That’s fantastic for the consumer but traditional TV studios have to recognise that we can’t stay away from these platforms even if it means experimenting. Our point of view is why does anything ever need to be in VR when we talk about a project. What are the narrative and technical requirements that would go into producing that and how are the very least are we learning and gaining enterprise information about this new platform so that we can be positioned in a very competitive market going forward.”

One way Sony plans to facilitate this is through social media. “That’s the one thing we’re really excited about, it’s the role social starts to play in the medium,” added Zim. “It’s one of the biggest challenges we have to make VR something that’s not just for a ninflated use case. How do we create the content that allows for interactive activity in real-time?”

All these plans rest upon how flexible Zim, Heller and their peers are open to looking further afield then each other for help. Game developers have long wrestled with the concept of interactive narratives and yet those movie executives at CES acknowledged that they haven’t done enough to harness that experience. Unlike in filmmaking, there are no knowns when it comes to crafting virtual experiences, something Hollywood is slowly getting its head around.

“[Producing VR] is very different from filmmaking,” said Kim Adams, senior producer at Oculus Story Studio. You have game engineers, software engineers, script writers and artists working together to create this whole new environment. There’s no tried and tested system and so the projects that we do are just burning through what works and what doesn’t. It’s too soon to refine what those things are.”